Tuesday, January 16, 2018

PTMP: Losses making fashion company in Penang Undersea Tunnel Project

Filepic: PenangPropertyTalk

Did the Penang Govt do a "bait and switch" on the Penang people?

That was the question posed by MCA deputy president Datuk Seri Dr Wee Ka Siong after it was revealed that a local fashion company has been identified as the shareholder of a special purpose vehicle (SPV) for the RM6.3bil Penang undersea tunnel project.

He questioned how the DAP-led Penang state government can claim that it is normal for a loss-making local fashion company to be suddenly involved in building a complicated multi-billion undersea tunnel as its first project as part of normal buisness diversification process.

Shareholdings disclosure of the company on Bursa Malaysia. Pic: mca.org.my

Shareholdings disclosure of the company on Bursa Malaysia. Pic: mca.org.myShareholdings disclosure of the company on Bursa Malaysia. Pic: mca.org.my

"Taking aside the fact that the fashion company has reported losses in each of the past 3 financial quarters and their last financial statement submitted to Bursa Malaysia on 29 Nov 2017 showed that the company had cash balances of RM1,7 million and short-term loans of RM16.5 million, I believe the Penang Government is completely missing the point.

"The main point is that the Penang Govt had reassured and promised to the people of Penang in March 2013 when the project was awarded that the Special Purpose Vehicle (SPV) company had strong financial backing of RM4.6 billion and had deep experience in construction," Wee highlighted, in a statement posted on MCA's website.

He points out that five years later there was nothing to show except for the millions spent on uncompleted feasibility studies.

“Did the DAP government lie to the public and made a bait and switch?" he asked.

Meanwhile, political analyst Datuk Eric See-Toh has revealed that the project never awarded on open tender.

"This is an interesting development as the project was never awarded based on Open Tender as DAP frequently claims.

"It was done via a Request for Proposal (RFP) exercise where a company was then selected for further negotiations before agreement signing," he noted in a recent Facebook posting.

"The Penang Government should release the minutes of why the winner was selected and why others were rejected," he urged the DAP-led Penang government to give a proper explanation over how this could have happened.

This is important, he stressed as the result has clearly led to "such lop-sided terms that is in favour of the contractor and at the expense of the people of Penang" which is the reason for the Malaysian Anti-Corruption Commission (MACC) investigation now.
"Allowing many to participate in an open RFP is not the most important question but how and on what basis the final party was selected and the negotiations after that," he added.

"Taking aside the fact that the fashion company has reported losses in each of the past 3 financial quarters and their last financial statement submitted to Bursa Malaysia on 29 Nov 2017 showed that the company had cash balances of RM1,7 million and short-term loans of RM16.5 million, I believe the Penang Government is completely missing the point.

"The main point is that the Penang Govt had reassured and promised to the people of Penang in March 2013 when the project was awarded that the Special Purpose Vehicle (SPV) company had strong financial backing of RM4.6 billion and had deep experience in construction," Wee highlighted, in a statement posted on MCA's website.

He points out that five years later there was nothing to show except for the millions spent on uncompleted feasibility studies.

“Did the DAP government lie to the public and made a bait and switch?" he asked.

Meanwhile, political analyst Datuk Eric See-Toh has revealed that the project never awarded on open tender.

"This is an interesting development as the project was never awarded based on Open Tender as DAP frequently claims.

"It was done via a Request for Proposal (RFP) exercise where a company was then selected for further negotiations before agreement signing," he noted in a recent Facebook posting.

"The Penang Government should release the minutes of why the winner was selected and why others were rejected," he urged the DAP-led Penang government to give a proper explanation over how this could have happened.

This is important, he stressed as the result has clearly led to "such lop-sided terms that is in favour of the contractor and at the expense of the people of Penang" which is the reason for the Malaysian Anti-Corruption Commission (MACC) investigation now.

"Allowing many to participate in an open RFP is not the most important question but how and on what basis the final party was selected and the negotiations after that," he added.

"According
to a MACC source, the investigation was zeroing in on the tender
process and appointment of the company to carry out the feasibility
study for the (Penang Tunnel) project." said a report today.

This is an interesting development as the project was never awarded based on Open Tender as DAP frequently claims.

It was done via a Request for Proposal (RFP) exercise where a company
was then selected for further negotiations before agreement signing.

The Penang Government should release the minutes of why the winner was
selected and why others were rejected as well as the minutes of the
attendees and what was discussed during the negotiations with the winner
prior to the final agreement that led to such lop-sided terms that is
in favour of the contractor and at the expense of the people of Penang.

Allowing many to participate in an open RFP is not the most important
question but how and on what basis the final party was selected and the
negotiations after that.